Mortgage Information



Things you should know about financing

1. The ADVANTAGE CARD takes the worry out of buying a home! Our ADVANTAGE CARD is a genuine loan commitment valid for 60 days. We offer a fully processed and completed mortgage approval before a buyer finds a home. The ADVANTAGE CARD offers serious home buyers a financial of approval so that you can negotiate with confidence, clearly identify ability to buy, and increased home buying leverage. You can shop for a home like a cash buyer with our exclusive ADVANTAGE CARD program.

2. Jump start your loan process with RAPID TRACK. The RAPID TRACK promise: A decision will be reached on your loan within one business day of our receipt of your substitute documents. Gather the required documentation and bring them to the application appointment. That way, your mortgage representative can immediately begin the application process. You will need to bring:

  • A copy of the signed purchase agreement
  • W-2’s for the past two years (or complete tax returns if self-employed)
  • Twelve months mortgage of rent payment receipts of canceled checks
  • Most recent pay stubs covering the last 30 days
  • The last two months bank statements
  • Names, addresses, and account numbers of creditors

Be sure to review this list carefully so that all the requested documentation is brought to the application appointment. And, that’s it! The rest of the approval and closing process is in the hands of your mortgage professional! Why should you have to wait for your loan decision? Take the RAPID TRACK!

3. FHA (Federal Housing Administration) loans are for everyone. Unlike local state bond subsidy programs, FHA loans have no income restrictions. Whether a first time purchase or a move to a bigger home, FHA mortgages require less money down and less income to qualify. FHA guideline allow home buyers to receive financing help from relatives. For example, the entire down payment and/or loan fees (such as closing costs) can come from gifted funds in order to help home buyers who are short on cash assets. FHA loans come in a variety of options. From long-term fixed rate mortgages to short-term adjustable rate loans, we have the right FHA loan for any need. FHA programs make home financing easy. Downpayments are lower than conventional financing, liberal qualifying requirements, and flexible repayment terms are available.

4. VA (Veterans Administration) loans require no down payment and have the most liberal qualifying requirements of any mortgage program. This is the most common choice for eligible veterans. VA loans are available up to 100% of the purchase price of a home. That means no money down and no minimum out-of-pocket investment are needed by the eligible veteran. Closing costs and most other loan fees can be gifted or paid by the seller or lender. No other loan offers as much for so little as VA. VA guidelines allow up to 41% of a borrowers income to be used toward qualifying for the mortgage payment (depending upon other debt). That’s higher than any conventional or FHA loan and really expands a veterans ability to buy a home. And, best of all, VA loans are not a one-time benefit to veterans. Eligible veterans can use VA financing to buy their first home or their next home, even if they’ve used VA financing before!

5. FLEX/FIXED means lower down payments! Buyers can compare which mortgage program they prefer - ARM rates that can rise as much as six percent, or the low start rates and the low three percent lifetime cap of a FLEX/FIXED loan. FLEX/FIXED is a unique program that "buys down" that start rate of a loan. It provides home buyers with a beginning rate as low as three percent below the established fixed rate. The lower start rate means a lower start payment. That means buyers who thought they couldn’t afford to buy a home can now do so with FLEX/FIXED. Buyers who are already qualified can also benefit by qualifying for more expensive homes. With more than 1,700 loan combinations, FLEX/FIXED helps more buyers qualify to buy the homes they want with lower start rates, low qualifying payments, and predictable payment schedules. FLEX/FIXED - The fixed rate mortgage with low start and qualifying rates.


Items Needed For A Credit Application
Refinancing Your Home
Questions to ask a Mortgage Banker
FHA New Loan Limits
Homefair's Salary Calculator
Why Use A Realtor


Items Needed For A Credit Application

Employment

Addresses for two full years
Gross monthly income
W-2s, if available
Proof of pensions, retirement, disability or Social Security
Proof of income from rentals, investments, etc.
Proof of child support or alimony paid/received
Year to date pay stub


If self-employed:

Two years 1040 Tax Returns
Current year profit and loss statement


Creditors

Each creditor's name, address and type of account
Account numbers
Monthly payments and approximate balances
Amount of child care expenses


Banking

Names and addresses of saving institutions
Account numbers for all accounts
Type of accounts and present balances


Miscellaneous

List of assets in stocks, bonds, land
Life insurance cash value (documented if used as cash down payment)
If applicant is selling a home, a copy of sales contracts
Social Security numbers for all parties
Veterans - Certificate of Eligibility & DD-214
Cash or check to pay for application fee

Refinancing Your Home

There are many "rules of thumb" used to determine when is the right time to refinance a home. You might have heard something like, the interest rate on the new loan must be at least two percent less than the old loan or it is not a good decision.

Another frequently quoted but just as frequently incorrect statement says that if your loan is less than two years old, you shouldn't refinance now.

Neither of these is entirely accurate. The decision to refinance a home should be based on whether you will own the property long enough to recapture the expenses connected with the new loan.

The procedure can be as simple as subtracting the proposed new house payment from the existing payment to find out what the monthly savings will be. Then, divide the monthly savings into the cost of refinancing to determine the recapture point in months.

If you are planning to stay in the home at least that long, then, in most cases, you should refinance. The only exception is that when the existing mortgage is in the last few years of its life, it could be amortizing very fast. Usually, this will not occur unless you are in the last quarter of the loan life.

On refinancing a home, the points paid to acquire the loan, as well as the loan origination fee, cannot be written off as interest fully in the year paid. They must be spread over the life of the mortgage.

For that reason, you will probably be better off in getting a "par value" loan which means there will be few or no points charged. Even though the rate will be higher, the interest is fully deductible as long as the federal limits are not exceeded, and you can keep the cash in your account to earn interest.

If you are having any difficulty in making a decision, please call me. I'd be pleased to help provide the information you need.

Questions To Ask A Mortgage Banker

When talking to a mortgage banker prior to making an application, it might be helpful to have he answers to the following questions in order to make an informed decision.

Will this loan be sold on the secondary market or will it be placed in your portfolio?

If private mortgage insurance is required, at what point will it be unnecessary so that it can be dropped?

When does the servicing department pay the property taxes to insure the income tax deduction for that year?

How many months worth of property taxes and insurance are required for the reserve account?

If obtaining an adjustable rate mortgage, describe how and when the loan can be converted to a fixed rate mortgage and what charges will be involved. Will another appraisal be required?

If obtaining an adjustable rate mortgage, what is the margin, index, and anniversary for adjusting the payments?

When is the house payment due and when is the late fee incurred? What is the late fee?


FHA New Loan Limits

FHA has raised their maximum loan limits for the following counties: Boone, Campbell, Kenton, Grant, Gallitin, and Pendleton.

1 Family $118,550
2 Family $133,500
3 Family $162,200
4 Family $187,150

These increases take effect August 1, 1996



Why Use A Realtor

When you're looking for help buying or selling property, it's important to remember that the terms "real estate agent" and "Realtor" are not synonymous. Realtors can provide an extra level of service, and to be a Realtor you must be a member of the National Association of Realtors. The equivalent organization in Canada is the Canadian Real Estate Association. Both are non-profit trade organizations that promote real estate information, education and professional standards.

The National Association of Realtors also has earned a strong reputation for actively championing private property rights and working to make home ownership affordable and accessible.


Code of Ethics

NAR and CREA members adhere to a strict code of ethics founded on the principle of providing fair and honest service to all consumers. Realtor business practices are monitored at local board levels. Arbitration and disciplinary systems are in place to address complaints from the public or board members.

This local oversight keeps Realtors directly accountable to the individual consumers they serve. Real estate licensees who are not Realtors, work solely under state/provincial licensing regulations.


Definitions

Realtor

A Realtor (or REALTOR) is a licensed real estate agent who is a member of the National Association of Realtors (NAR) a membership organization of some 720,000 real estate agents in the United States. In Canada, the corresponding professional organization is the Canadian Real Estate Association (CREA). A licensed real estate agent does not have to be a member of NAR or CREA to practice real estate.

Broker

In real estate, a broker has earned a broker's license. Many brokers own their own real estate office and are "brokers of record, " with other real estate agents "hanging their license" under the broker of record. 


Make your dreams a reality . . consult a Certified Residential Specialist today!

Thousands of homeowners each year trust Certified Residential Specialists (CRS) A CRS is a dedicated professional who is a member of the NATIONAL ASSOC. OF REALTORS and has earned advanced certification by completing the course work and experience requirements of the Residential Sales Council.

For any Real Estate information, contact
Mike Parker - CRS, GRI, SRES, ABR at
859-647-0700 or 800-356-4530
or by E-mail

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